Gold down third session to a more than 2-week low

WilliamL. Watts

SAN FRANCISCO (MarketWatch) — Gold prices on Tuesday fell a third consecutive session to their lowest settlement in more than two weeks.

Gold for August delivery
US:GCQ4
shed 50 cents to settle at $1,316.50 an ounce on the Comex division of the New York Mercantile Exchange. Prices had already tallied a loss of nearly $14 an ounce, or 1.1%, over the past two trading sessions and based on the most-active contracts, closed Tuesday at their lowest since June 20.

September silver
US:SIU4
ended nearly flat $21.01 an ounce following a loss of 1.4% in the past two sessions.

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This is a “strange” market where gold demand is “steady and solid in a relatively thin market, but not swayed by speculators,” said Julian Phillips, founder of and contributor to GoldForecaster.com. “Speculators and dealers are trying to move gold around with the euro, which keeps going stronger as the dollar weakens.”

But gold “keeps drifting higher as U.S. investors are now net buyers of the SPDR gold ETF in the last three weeks,” he said. Shares SPDR Gold Trust
GLD, -1.12%
were last down 0.3%, but they trade roughly 9% higher year to date.

“Technically, gold is looking good and should therefore rise over the week,” said Phillips.

But Marex Spectron’s manager of precious metals David Govett said he believes that gold has “done enough on the upside for the time being,” although the downside is fairly limited.

Gold is often seen as a hedge against inflation and in a speech Tuesday, Jeffrey Lacker, president of the Richmond Fed, said keeping inflation under control will require the Federal Reserve to be pre-emptive. Separately, Narayana Kocherlakota, the president of the Minneapolis Fed, downplayed recent higher readings on inflation, saying he expects the price level to stay below the central bank’s target for several more years.

Elsewhere in metals trading, October platinum
US:PLV4
rose 90 cents, or 0.1%, to end at $1,496.50 an ounce, and September palladium
US:PAU4
rose $3.95, 0.5%, to $872.90 an ounce. High-grade copper for September delivery
US:HGU4
closed less than half a penny lower at $3.26 a pound.

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